Income Tax Issues
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Avoiding the Net Investment Income Tax with Significant Participation

Uncle Bill’s Net Investment Income Tax Quandary Suffice it to say that Uncle Bill had a good year in 2021. As you may remember from this article, Bill and Ethel’s daughter Moon (neé Jaime) was one of the initial investors in a small online book retailer based out of Seattle that was founded by her friend Jeff. When the website took off, Moon made a pretty penny (or 304 billion pretty pennies). Bill invested a

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Scott St. Amand March 29, 2022
Income Tax Issues
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Briefly Taxing’s Guide to the Income Tax Refund Process for Individuals

It was a Tuesday in 2016, if memory serves, when your mother called you to let you know about the unfortunate events that had beset your Mainer family the week prior. After some brief research (thanks, Google), you discovered that the tornado was the first to hit York County, Maine in nearly a decade, and it was the first major tornado since October 10, 1966.[1] If a tornado were going to hit Biddeford, somehow Uncle

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Scott St. Amand November 22, 2021
Income Tax Issues
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Partial Payments of Tax and Deposits with the IRS

Sunday afternoon rolls around, and the last thing on your mind was explaining the pros and cons of making partial payments of tax and deposits with the IRS to a relative who still sees “Charlie” lurking in his backyard from time to time. Nonetheless, of all of your relatives, Cousin Elmer is, surprisingly, the least offensive to you. You may remember that Elmer is currently working with only seven and a half fingers and a

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Scott St. Amand November 17, 2021
Income Tax Issues
Income Tax Issues

The Claim of Right Doctrine and Illegally Obtained Funds

The Claim of Right Doctrine and Cousin Jethro After your Uncle Bill’s unfortunate forklift incident, mentioned here and here, you were surprised to hear that Bill’s idiot boy Jethro got a job at the tannery, especially in light of his somewhat checkered past and run-ins with the law. The more you learn about Jethro’s new job, however, the more it makes sense. Unbeknownst to you, the tanneries of New England are run by a group

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Scott St. Amand November 8, 2021
Income Tax Issues
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The Test for Profit Motive: Allowance of Deductions under IRC § 183 Test

What factors aid the Tax Court in deciding when an activity is entered into with a “profit motive” (with allowable ordinary and necessary expenses) versus a hobby (where losses may be taken only up to the amount of profit received)? Taxpayers can deduct all ordinary and necessary expenses paid or incurred in carrying on a trade or business,[1] for the production or collection of income,[2] or for the management, conservation, or maintenance of property held

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Scott St. Amand July 15, 2021
Income Tax Issues
All Articles

Grantor Trusts – Part IV of IV – Retained Powers and Non-Grantor Owners

In Part I of this series on Grantor Trusts, we look at the nature of trusts in general.  In Part II, we shift to a look at grantor trusts, and a few definitional rules.  In Part III and Part IV, we take a deep dive into the interests that a grantor may retain that will cause a trust to be treated as a grantor trust as well as instances in which a person other than

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Scott St. Amand July 5, 2021
Income Tax Issues
All Articles

Grantor Trusts – Part III of IV – Reversionary Interests and Powers to Control Beneficial Enjoyment

In Part I of this series on Grantor Trusts, we look at the nature of trusts in general.  In Part II, we shift to a look at grantor trusts, and a few definitional rules.  In Part III and Part IV, we take a deep dive into the interests that a grantor may retain that will cause a trust to be treated as a grantor trust as well as instances in which a person other than

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Scott St. Amand July 5, 2021
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Norberg v. Commissioner
T.C. Memo. 2022-30

On April 5, 2022, the Tax Court issued a Memorandum Opinion in the case of Norberg v. Commissioner (T.C. Memo. 2022-30). The primary issue presented in Norberg v. Commissioner was whether the settlement officer abused its discretion in upholding a notice of intent to levy and denying the petitioners’ request

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Scott St. Amand January 24, 2023

Salter v. Commissioner
T.C. Memo. 2022-29

On April 5, 2022, the Tax Court issued a Memorandum Opinion in the case of Salter v. Commissioner (T.C. Memo. 2022-29). The primary issues presented in Salter v. Commissioner were (i) whether the Code section providing exception from imposition of additional tax resulting from early distribution from retirement plan applied;

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Scott St. Amand November 23, 2022

Middleton v. Commissioner
T.C. Memo. 2022-28

On April 4, 2022, the Tax Court issued a Memorandum Opinion in the case of Middleton v. Commissioner (T.C. Memo. 2022-28). The primary issues presented in Middleton v. Commissioner were (i) whether the taxpayer could challenge the Trust Fund Recovery Penalty at his CDP hearing; and (ii) whether the taxpayer

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Scott St. Amand November 22, 2022

Villanueva v. Commissioner
T.C. Memo. 2022-27

On March 31, 2022, the Tax Court issued a Memorandum Opinion in the case of Villanueva v. Commissioner (T.C. Memo. 2022-27). The primary issue presented in Villanueva v. Commissioner was whether the petitioner was entitled to a net operating loss deduction. Held: Sorry, Edgardo, not today. Background to Villanueva v.

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Scott St. Amand November 21, 2022

Golditch v. Commissioner
T.C. Memo. 2022-26

On March 29, 2022, the Tax Court issued a Memorandum Opinion in the case of Golditch v. Commissioner (T.C. Memo. 2022-26). The primary issues presented in Golditch v. Commissioner were (i) whether the taxpayer was permitted to challenge his underlying tax liability at CDP hearing; (ii) whether the taxpayer’s argument

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Scott St. Amand November 18, 2022

Porter v. Commissioner
T.C. Memo. 2022-25

On March 28, 2022, the Tax Court issued a Memorandum Opinion in the case of Porter v. Commissioner (T.C. Memo. 2022-25). The primary issues presented in Porter v. Commissioner were whether (i) delays in examination and litigation were attributable to IRS officer or could significantly be attributed to taxpayer; and

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Scott St. Amand November 17, 2022